Lottery is the practice of awarding prizes, such as money or goods, based on chance. The casting of lots for determining fates and decisions has a long history in human culture, and the use of chance to distribute material wealth is well documented in many cultures around the world. Prizes in the form of cash or goods are the most common, although services may be awarded as well. Some states have legalized state-sponsored lotteries in which the proceeds are used for public purposes. The term “lottery” is derived from the Dutch word lot, meaning fate or destiny, which is in turn from Middle English loterie or “action of drawing lots,” or possibly from Latin loterium “fateful thing.”
A lottery requires a pool of tickets or their counterfoils to select winners. These must first be thoroughly mixed by some mechanical means, typically shaking or tossing. The selection of winning numbers or symbols is then made by a randomizing procedure such as a drawing, or, more recently, computer programs. The computer is preferred, as it can process large numbers and produce random results more quickly than a person could. The result of the draw is published, and the winning tickets are checked against those purchased.
While lotteries are popular, they have considerable critics, who cite concerns such as their tendency to attract compulsive gamblers; the regressive impact on lower-income communities; the amount of time and effort required to research and pick a number; and whether governments should be in the business of encouraging gambling. In addition, the fact that lotteries are run as businesses and primarily focus on increasing revenues can generate serious problems.
Once established, lotteries are very difficult to abolish. A typical scenario is a state that legislates a monopoly for itself; establishes a government agency or public corporation to run it (as opposed to licensing a private firm in exchange for a share of profits); starts operations with a modest set of relatively simple games and, due to pressure for additional revenue, progressively expands the lottery’s size and complexity, especially by adding new games.
In general, state lotteries are poorly managed. This is because policy decisions are often made piecemeal and incrementally, with the result that government officials inherit a system that they have no control over. Additionally, a lottery’s dependence on revenues means that it is vulnerable to pressures for increased spending and taxes. This can create substantial tensions with other aspects of the state’s budget, as was the case in Oregon when lottery revenues accounted for more than half of its general fund.